Page 29 - Brewdog Teaching Notes

indication of the return that can be expect on that

investment.

Given that BrewDog planned to give away 20% of its profits
every year — half to staff and half to charity. The remainder

of profits to be spent on expanding the business for “at

least” the next seven years, meant that there was little hope

of investors seeing any return until that period is over or

unless there is an IPO.

The investors who bought in at the very first fundraising had

seen the value of their stake soar. For later investors, it’s

difficult to see from where fresh gains would come. For £1

billion to make any sort of sense, profits would need to

increase fast. At the time this did not seem likely or even a

specific goal given the plans for profit use at the time-

2017/8.

Since it was founded in April 2007, till 2017 Brewdog had

raised towards £60 million from around 78,000 small

investors.

Market Value £1bn

Share Value 2017 £6,590 (2,765% rise in seven years)

Share dilution 1-500

15% saleable = £6,590 ÷ 100 = £659 ×15 = £988.5

shares